Three South East Asian countries seeing developments, and predicted to experience more school investment, are Thailand, Vietnam and Malaysia. ISC’s Field Research Consultant for South East Asia, Sam Fraser explains.

Thailand

Admissions enquiries for the new academic year are high at the international schools in Bangkok. However, as the number of international schools continues to grow the market is becoming increasingly competitive. As a result, more schools are benchmarking themselves and intensifying their marketing, using print advertising, admissions events, billboards and online advertising to attract parents.

The majority of demand for admissions continues to come from Thai families while expatriate demand remains stable. Two student nationalities that are notably increasing are Chinese and Japanese passport holders. Thailand has a close trade relationship with China, but it’s largest FDI contributor continues to be Japan accounting for 36% of contributions in 2016. This growth poses an additional challenge for schools as many of these students require additional English learning to enter at the correct grade level. The majority of international schools are insufficiently resourced to respond effectively to this need.

Vietnam

The government has been debating an amendment to Decree 73 - its policy which limits the number of local children able to attend Foreign-invested international schools - for many months. There was talk last year of an abolishment, but this is yet to come and is unlikely to happen any time soon. The government has confirmed this but is suggesting an amendment to the quota in the near future, increasing it to a maximum of 50% of all enrolments. This may encourage some foreign investment, particularly for schools that will appeal to the increasing number of Asian expatriates moving in to the country, primarily from Japan and South Korea. But until restrictions are removed and foreign investment is actively supported by the government, development will remain cautious.

In the meantime, some local parents continue to send their children to boarding schools overseas, predominantly in the UK and US fuelled by the limitations of accessible international education at home. According to the Institute of International Education (IIE), Vietnam ranks third for high school age student mobility to the United States, only after China and India. This accounts for almost 4,000 pre-tertiary Vietnamese children heading to the US alone to attend public and private day schools, boarding schools and high school completion programmes.

There are some international schools in Vietnam fully accessible to local children. This includes Vietnamese-owned international schools, such as ABC International School in Ho Chi Minh City, the most reputable of which are in high demand with waiting lists. Also, Vietnam’s bilingual schools, which are accessible to local children and where 50% of the curriculum is delivered in English and 50% in Vietnamese, are seeing demand continually increase.

Vietnam is now developing at pace, particularly its leading cities. Several multinational companies, including Samsung, Hyundai and Mitsubishi have operations established and there’s particular development interest from Japanese and Korean investors because labour and construction costs are now as competitive as those in China. Ho Chi Minh City is burgeoning, with new residential developments being constructed throughout the city. District 2, where several international schools are located, has received particular development focus, and the city’s infrastructure is being improved too. This includes a new train line, and a brand new airport that’s being built 40km from the centre to meet the increased demand into the city. To ease congestion during this development, Ho Chi Minh’s existing airport will see the construction of an additional runway.

Malaysia

There is increasing demand by Malaysia’s local population for their children to attend international schools if the price is right and Malays now make up the largest student nationality. Mid-price schools, affordable to increasingly affluent Malay families, are seeing the most demand and will continue to do so.

Plenty is happening to boost economic growth in Malaysia right now. Infrastructure projects underway in Johor are prompting extensive commercial and residential development. Last August (2017), construction began on Malaysia’s 688km East Coast Rail Link. Scheduled to be complete by 2024, the rail link will stretch down the east coast of Malaysia and Thailand. This will open up access to previously untapped areas of Malaysia as well as connecting the South China Sea to the Straits of Malacca which could alter currently embedded trade routes in the region.

Investment in the international education sector is increasing, prompted by the ease of opening and running an international school in the country, plus the expanded demand for school places since enrolment caps for local children were lifted. As well as international schools now allowed to accept up to 100% Malaysian students if they wish, other regulations encouraging school development have been eased. These include the ability to hire new staff with as few as two years teaching experience, and minimal visa constraints for expatriate employees.

More data and intelligence to support school investment, strategic planning, benchmarking and business development is available from Sam, ISC Field Researcher for South East Asia at sam.fraser@iscresearch.com or Head of Asia Research, Sami Yosef at sami.yosef@iscresearch.com